Mathews v. Savings Union Bank & Trust Co.
Mathews v. Savings Union Bank & Trust Co.
Opinion of the Court
This appeal concerns the construction of sections 1269a and 1273 of the Code of Civil Procedure, and section 15 of the Bank Act, as they were amended in 1915. They relate to escheats of unclaimed bank deposits. The facts are admitted.
In 1868, William Anderson deposited with the Savings Loan Society Bank of San Francisco, the predecessor of the defendant, one thousand five hundred dollars, which with the accumulations of interest grew to $12,525.12 by the 1st of January, 1917. Anderson died at his residence in Lake County in August, 1892. Under the provisions of section 15 of the Bank Act the defendant made report to the state treasurer that for twenty years prior to the first day of January, 1917, there had been neither deposit nor withdrawal of funds from the Anderson account and no claim had been made nor address of the owner of the account filed within the twenty-year period. On March 16, 1917, the public administrator of Lake County was granted letters of administration on the estate of Anderson, and on the day following he made demand upon the bank for payment of the deposit account, which being refused, the administrator sued the bank at its place of business in San Francisco. The attorney-general intervened on behalf of the state. The judgment was against the plaintiff and in terms declared the money on deposit had escheated on January 1, 1917, nearly nine months before the judgment was entered.
In this case there is no question of identity involved. The plaintiff as the administrator of the estate of the depositor stands in his shoes. His rights in regard to the money in question are neither greater nor less than those of the de *48 positor. If, on December 31, 1916, either the depositor or the administrator of his estate had made demand on the bank, it was obligated to pay, because the money then on deposit rightfully belonged to the depositor or his estate. If payment had been refused, the superior court in San Francisco would have had jurisdiction of a suit against the bank, and upon the admitted facts its judgment must have been in favor of the depositor or his personal representative. Because the demand was not made until after January 1, 1917, the trial court determined, and the attorney-general here argues that the moneys escheated on that day, that the right of the depositor to the immediate payment no longer existed, and that this result flowed from the amendments of 1915.
So careful is the state of the rights of its citizens that even after the adjudication, for a period of five years, any person not a party or a privy to the escheat judgment may sue the state to recover the money, and this time is extended to infants and persons of unsound mind for a period of one year after the removal of the disability. (Code Civ. Proc., sec. 1272.)
In the suit commenced by the attorney-general any claimant may appear and present his claim of ownership. (Code Civ. Proc., sec. 1273.) The attorney-general argues that the only adverse claim which could prevail in the suit would be one based on the nonexistence of the very fact on which the suit is based, namely, that no claim had been made within the twenty years of dormancy. If this construction should be adopted, how unreliable would be the guaranty of justice contained in section 15 of the Bank Act, which provides that “any person interested may appear in such action and become a party thereto,” and that “the court shall have full and complete jurisdiction over the state, and the said deposits and of the person of everyone having or claiming any interest in the said deposits, or any of them, and shall have full and complete jurisdiction to hear and determine the issues therein, and render the appropriate judgment thereon. ’ ’ This language is most appropriate to provide for a real trial of the claim of interest or ownership, and it is equally inappropriate to provide for a merely formal adjudication of the jurisdictional fact of nondemand for a period of twenty years. Just as the statute provides for a claim of ownership after the judgment, so does it provide for a claim of ownership after the attorney-general sues and before the judgment. Of course, a claim may be made by the owner against the bank at any time before the expiration of the twenty years. There necessarily must elapse a period of time between the expiration of the twenty years and the commencement of the state’s suit. What are the rights of the owner of the money during that intermission?
Suppose the depositor had not died, but returning from a far country had been delayed by stress of weather, so that a demand which would have been honored on December 31st could not be presented until January 2d; suppose, further, that he was in sickness, that his family was in distress, or that the fund he had thriftily laid by against the day of his dire need alone would save him from the bankruptcy court; and, suppose the bank should pay him what rightfully was his, is it conceivable that the court in Sacramento would require the bank again to pay the amount of the deposit to the state? If the bank should refuse to pay upon such a demand, as it did in this case, would the admitted owner of the deposit be compelled to wait until the attorney-general should find time or be willing to open the door of the Sacramento court so that he might as a defendant present his claim? Under such a rule he might be driven into bankruptcy, and he and his- family become public charges. It would be no answer to say he might by the roundabout method of mandamus force the attorney-general to throw open the door of the Sacramento court. The rule that justice shall not be denied is no more sacred than is that which declares it shall not be delayed. Until suit is brought by the attorney-general in Sacramento County, the court having jurisdiction of an action by anyone for property which another without right withholds is open to the depositor, as well after as before the expiration of the twenty-year period. In the exercise of its constitutional jurisdiction (Const., art. VI, *51 sec. 5) the superior court in San Francisco had power to entertain the suit of the plaintiff, and its jurisdiction having attached, it necessarily had power to determine the substantial rights of the parties before it. (Hibernia etc. Soc. v. Lewis, 117 Cal. 577, [47 Pac. 602, 49 Pac. 714]; Peck v. Jenness, 7 How. 612, 624, [12 L. Ed. 841, see, also, Rose's U. S. Notes].)
What has already been said concerning the question of jurisdiction applies equally to the substantial rights of the parties. A construction of section 1273 of the Code of Civil Procedure and section 15 of the Bank Act, by which title to money on deposit would pass to the state absolutely on the expiration of twenty years, without compensation to the owner and without notice and hearing before his property should be taken, would be intolerable.
The judgment is reversed.
Langdon, P. J., and Haven, J., concurred.
A petition to have the cause heard in the supreme court, after judgment in the district court of appeal, was denied by the supreme court on October 23, 1919.
All the Justices concurred, except Wilbur, J,
Reference
- Full Case Name
- MACK MATHEWS, Administrator, Etc., Appellant, v. SAVINGS UNION BANK AND TRUST COMPANY (A Corporation), Defendant; STATE OF CALIFORNIA, Respondent
- Cited By
- 12 cases
- Status
- Published